Reading economic success still leaves unanswered question about how we distribute our wealth

It is not acceptable some five per cent have no formal qualifications and this urgently needs addressing

by Nigel Horton-Baker

19:00, 19 Jan 2015Updated13:03, 19 Jan 2015

Views from 13th floor of The Blade

What makes for a productive economy? Well, according to the think-tank, Centre for Cities, which releases its annual health check of UK cities today, Greater Reading has what it takes.

Cities Outlook 2015 ranks Reading number one in the UK for productivity - the economic contribution per worker, defined as GVA (Gross Value Added), with an average contribution of £70,900 per person to the economy. But, what lies behind this success?

Our economic productivity is a reflection of the type of economy we have, the levels of turnover our businesses generate and the levels of employment in Reading, particularly the highly skilled.

At the heart of Reading’s success is an economy which has been powered by knowledge-intensive businesses for a number of decades, in particular the technology, finance, energy and professional services sectors, which employ highly-skilled staff earning high salaries.

Success breeds success. Businesses working in these sectors see in Reading a ready availability of skilled labour while people working in these fields elsewhere are attracted here by the prospects of jobs and high salaries.

Reading’s ability to attract even more highly skilled staff will be further enhanced by the massive improvements to the rail network, including the new station and associated track improvements, the viaduct, electrification and the prospect of Crossrail in 2019

These factors are reflected in the Centre for Cities report with Reading ranking third for the number of businesses per population, second only to London for salary levels and seventh for the proportion of University-level educated people. All in all, there are more people working in jobs that create higher value products and services in Reading than many other parts of the UK.

The major corporates based in the Greater Reading economic area, which transcends the borough boundary, play a significant part in Reading’s much envied economic output. Not just in terms of the revenues and jobs they generate themselves but for the spin offs they create.

Reading ranks fifth in the UK for start-up companies. Our innovation-based economy creates many new businesses from these corporates and also attracts small and medium-sized businesses to co-locate in order to work in partnership with the likes of Microsoft or Huawei.

This report demonstrates the cumulative reasons that make Reading a powerhouse of the UK economy and such an attractive location for business and investment.

For Reading to continue to be one of the UK’s leading economies, we need to retain those businesses here and we need to maximise the benefits of the current massive investment in Reading’s transport infrastructure to attract more businesses to relocate here, swapping high costs and hectic lives in London for a cheaper, better quality of life in Reading.

While Cities Outlook rightly points to Reading’s many successes, it also highlights issues that need addressing.

We need to ensure that the benefits of this strong economic performance are shared by all sectors of society.

It is not acceptable that 5 per cent of our working population have no formal qualifications and that there are still people of all ages that cannot access work, training or education.

The Elevate Reading programme is working hard to address this by bringing together a wealth of expert knowledge in one place where young people, in particular, can go to get the best advice, guidance and support.

Crack this problem and then, and only then, can we say that we are a truly successful and sustainable economy.

Do you agree with Nigel? What are your thoughts? Let us know in the comments below